Inflation hits 16.5%, highest in 11 years

Nigeria’s inflation rate has increased to 16.5% in June, the highest in almost 11 years.

This increase is presently making the task of the Central Bank of Nigeria, CBN, more difficult in an economy which is at risk of contracting this year.

According to the National Bureau of Statistics, the inflation rate in Nigeria’s economy increased to 16.5 per cent from 15.6 in May.

This recent increase is the highest rate since October 2005, according to data on the CBN’s website. Prices rose 1.7 per cent in the month. The currency’s official exchange rate weakened to more than N280 per dollar, compared with the fixed rate of N197-199, and the Naira trades at around 360 on the black market, increasing prices for consumers.

National Bureau of Statistics in a statement, on Monday, said, “In June, the Consumer Price Index (CPI), which measures inflation, continued to record relatively strong increases for the fifth consecutive month.

“The Headline index increased by 16.5 per cent (year-on-year), 0.9 per cent higher from rates recorded in May (15.6 per cent). While most COICOP divisions, which contribute to the Headline index, increased at a faster pace, the increase was, however, weighed upon by a slower increase in three divisions: Recreation & Culture, Restaurant & Hotels, and Miscellaneous Goods & Services.

“Year-on-year, energy prices, imported items and related products continue to be persistent drivers of the core sub-index. The core index increased by 16.2 per cent in June, up by approximately 1.2 per cent points from rates recorded in May (15.1 per c ent). “During the month, the highest increases were seen in the electricity, liquid fuel (kerosene), furniture and furnishings, passenger transport by road, and fuels and lubricants for personal transport equipment.

“While imported foods continue to increase at a faster pace, the food sub index, on the aggregate, increased, albeit at a slower pace in June relative to May. The index increased by 15.3 per cent (year-on-year) in June up by 0.4 per cent from rates recorded in May. The index was weighted upon by a slower increase in the vegetables and ‘sugar, jam, honey, chocolate and confectionery’ groups.

“Month-on-month, the Headline index has moved in a sideways fashion since February, the first month of a pronounced increase in rates this year. Specifically in June, the index increased by 1.7 per cent, lower by roughly 100 basis points from rates recorded in May.”

 

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